Rising tech costs drive EMI sales; Shadowfax Q2 profit soars

Also in the letter:
■ Meesho eyes growth as costs rise
■ Honeywell’s physical AI bet
■ Virat Kohli’s stake in Agilitas rises

With prices of smartphones, laptops and other electronics rising rapidly in recent months, consumers are increasingly relying on equated monthly instalments (EMIs) and buy-now-pay-later (BNPL) options to make purchases this festive season, cushioning retailers against a slowdown in demand.

By the numbers: At Pai International Electronics, which operates across Karnataka, Andhra Pradesh and Telangana, 70-80% of smartphone sales this festive season were financed through EMIs, up from 40-50% last year. At Vijay Sales, which has 181 stores nationwide, EMIs accounted for about 70-75% of festive-season sales.

Price hike: Laptop prices have risen by nearly 35-40% in the last six months, and in some cases, even more. Mobile phone prices have increased by 25-40%.

What’s driving the cost: A two- to three-fold surge in memory chip prices, rupee depreciation and higher freight costs have driven up electronics prices, industry executives said.

Tell me more: Retailers are seeing greater participation from banks and non-banking financial companies (NBFCs), while brands are extending repayment periods to ease the upfront cost of purchases.

Abhishek Bansal, cofounder and CEO, Shadowfax

New-age logistics platform Shadowfax reported an increase in operating revenue in the September quarter, driven by growth in its express parcel and hyperlocal delivery businesses.

Financials:

• Operating revenue: Rose 57% to Rs 1,538 crore from Rs 982 crore a year earlier.
• Net profit: Jumped fivefold to Rs 68 crore from Rs 13 crore.
• Total revenue: Including other income, increased 58% to Rs 1,558 crore.
• Total expenses: Climbed 53% to Rs 1,490 crore.

Trucking aggregator BlackBuck reported a rise in net profit in the September quarter of FY27, on the account of growth in its tolling, vehicle tracking and newer businesses.

Financials:

• Net profit: Rose 42% to Rs 41.4 crore from Rs 29 crore a year ago.
• Revenue from operations: Increased 56% to Rs 235 crore.
• Total income: Grew 51% to Rs 253 crore from Rs 167.2 crore.
• Ebitda: Rose 39% to Rs 51 crore from Rs 37 crore.
• Total expenses: Climbed 36% to Rs 114 crore, driven by higher customer acquisition spending and investments in Superloads.

Amrish Rau, CEO, Pine Labs

Payments technology firm Pine Labs reported a more-than-sixfold rise in net profit in the September quarter, on the back of rising revenue from transactions processed through its existing merchant network.

Financials:

• Net profit: Rs 38.57 crore versus Rs 5.97 crore a year ago.
• Revenue from operations: Grew 24% to Rs 806.19 crore from Rs 649.90 crore a year earlier.
• Revenue from digital infrastructure, transaction platform business: Up 21% to Rs 531.55 crore.
• Online payments: Grew more than 45%; mid-market merchant checkout-point base increased 49%.
• Total expenses: Climbed 16% to Rs 770.37 crore.

Vidit Aatrey, CEO, Meesho

Meesho’s improving unit economics may face a near-term reversal as the ecommerce platform steps up investments to drive growth during the festive season.

Margins: The value commerce platform’s September quarter results on Wednesday showed its contribution margin rising to 6% of net merchandise value (NMV) in the second quarter of FY27 from 4.6% in the April-June period. Contribution margin is the income after deducting direct, order-linked expenses.

What’s driving the improvement: The primary driver for the quarter-on-quarter improvement in contribution margin was logistics efficiencies, including better return to origin (RTO) rates, increased order density, network redesign, and Valmo efficiencies.

Pressure points: Advertising and promotion spending climbed to 2.9% of NMV from 2.1%, and server costs rose to 2.3% from 1.9%, as Meesho reserved GPU capacity ahead of the festive sale. The improvement in contribution margin was offset by the higher spending on these counts.

Q3 outlook: The company expects some of these gains to reverse in the December quarter as it reinvests in the business to lower seller costs and scale newer businesses such as Meesho Mall and Content Commerce, tempering expectations of sustained margin expansion.

Anant Maheshwari, president and CEO, Honeywell’s global regions

Honeywell Technologies expects its Indian operations to achieve the $1 billion revenue milestone in the next two to three years. Earlier this year, Honeywell International split itself into three publicly traded companies – Solstice Advanced Materials, Honeywell Aerospace, and Honeywell Technologies.

India push: Honeywell Technologies, the company’s core automation business, remains focussed on India, where it currently has 11,000 employees or about 20% of the global workforce. In its earlier, larger avatar, Honeywell had hit $1 billion in revenue from India in 2025.

Physical AI play: Honeywell Technologies is leveraging its experience in operations technology to combine software and hardware for delivering physical AI. Such AI systems interact directly within the physical world and will be a big enabler of jobs and employment going forward, acting as a bridge between changes in labour flow in sectors such as petrochemicals and heavy engineering.

Abhishek Ganguly, founder, Agilitas Sports and Virat Kohli, cofounder and investor

Virat Kohli’s stake in Agilitas Sports rises: Cricketer Virat Kohli’s stake in Agilitas Sports has increased to 6.4% from 1.8%, following the merger of his sportswear brand One8 with the Bengaluru-based company. The increase in Kohli’s shareholding is because of the merger and is not because of any fresh investment by the cricketer. He had earlier invested Rs 40 crore in the sportswear startup.

CapGrid closes Rs 50 crore round: B2B manufacturing startup CapGrid has closed a Rs 50-crore round comprising primary and secondary transactions, which value it at Rs 430 crore, cofounder and CEO Dheeraj Tiwari told ET. The startup last raised Rs 45 crore in February 2025 at a Rs 305 crore valuation. Its latest round has come close on the heels of B2B manufacturing giant Zetwerk going public. The Bengaluru-based company has a market capitalisation of Rs 27,000 crore.

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